Climate Action Plan Tax

In November 2006, Boulder voters passed the Climate Action Plan (CAP) tax, the nation's first “carbon tax.”  The tax provides funding for programs to reduce community-wide greenhouse gas emissions.  City residents and businesses are taxed on their electricity use, per kilowatt-hour.  Xcel Energy collects the tax for the city through its monthly customer utility billing.  Customers who subscribe to wind-generated power through Xcel Energy’s Windsource program (for households or businesses) are not taxed for that portion of their electricity use.

Climate action goal
In 2002, the Boulder City Council passed a resolution committing the community to reducing its greenhouse gas emissions to the target established by the Kyoto Protocol, an international agreement adopted in 1997 to combat global climate change.  The goal is to reduce greenhouse gas emissions to seven percent below 1990 levels by 2012. 

Climate action programs
Meeting Boulder’s climate action goal requires everyone in the community to take action to change the way we use energy.  The Community Guide to Boulder’s Climate Action Plan serves as a roadmap for making these changes.  The guide outlines reduction strategies for each of the factors that affect community greenhouse gas emissions: home and business energy use, transportation, solid waste, urban forestry and city operations.

These strategies are implemented through climate action programs.  Examples include promoting energy audits for homes and businesses and installation of basic energy reduction measures, rebates and financing assistance for energy efficiency improvements and solar installations, and Eco Pass (bus pass) subsidies.

These and other programs are funded by the CAP tax.  For more information on climate action strategies, programs and specific actions you can take to reduce your carbon footprint, check out the Community Guide to Boulder’s Climate Action Plan.  The guide is an update to the original Climate Action Plan, which was adopted by City Council in 2006 and provided the initial framework for addressing local greenhouse gas emissions.

Tax rate history
The CAP tax passed by voters in 2006 approved a range of tax rates for each electricity user type -- residential, commercial and industrial -- and gave City Council the authority to set the rate for each user type within the approved range.

City Council initially set the rates at the bottom of each range.  In July 2009 council increased the rates to the maximums allowed by voters, to fund more extensive programming to accelerate community action to meet the climate action goal by 2012.  The new rates became effective on Aug. 6, 2009. 

The CAP tax is projected to generate approximately $1.6 million in 2010.  CAP tax revenues are expected to decline over time, as residents and businesses reduce their energy use and switch to greater use of wind and solar energy.  The CAP tax will expire on March 31, 2013.

Current CAP Tax Rates

kWh = kilowatt-hour

Questions about the tax?
• For billing questions, please contact Xcel Energy at 800-895-4999.
• For general questions about the tax or Climate Action Plan programs, please contact City of Boulder Local Environmental Action Division Manager Kara Mertz at This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

Boulder's 'Carbon tax' Paper - details the City of Boulder's process through the Climate Action Plan tax implementation 

Last Updated on Wednesday, 30 June 2010 10:58